The Honda formula one team face a deadline today to commit to an ¤8m (£7m) deal for Mercedes-Benz engines which would ensure Jenson Button and Bruno Senna will be on the starting grid for the first race of the new season, the Australian grand prix in Melbourne on 29 March.

Unless Mercedes receive this undertaking it is likely the Brackley-based team will shut down in the next few days and its 700-strong workforce made redundant.

The Honda team's precarious situation was exacerbated yesterday when Bernie Ecclestone, the formula one commercial rights holder, claimed the current Honda racing team management had rejected his offer of help with a management buy-out. According to the News of the World, Ecclestone offered £100m for a controlling share in the team with the current principal, Ross Brawn, and chief executive, Nick Fry, each retaining 17.5%.

Ecclestone said: "I tried to help with the management buy-out. They should have taken what I offered. It was a very good offer for all concerned. It gave them complete freedom to do things on their own. Now all we can do is hope and pray. I don't think anybody knows what is going to ­happen with Honda. It's up to them to make up their bloody minds. But the team can go one of three ways.They either go with the management, go with [Richard] Branson or they could simply close the whole thing down."

Ecclestone made it clear that one of the reasons he is keen for the team to survive was that it would present the opportunity for the formula one debut of Senna, the nephew of the late triple world champion Ayrton Senna who was killed in the 1994 San Marino grand prix at Imola.

Branson, meanwhile, said formula one needs to rectify its faults before his ­Virgin group become involved. "If Bernie Ecclestone can make it more cost-effective for the likes of the Virgin brand to come into the sport, and if he can champion clean motor-car racing – which is possible to do by making sure all the cars run on clean fuels – then at some stage we might be interested in getting involved," he said.

In a separate interview with BBC Radio 5 Live, he said: "I think there are faults that would need to be rectified before we could go into formula one." Although his comments suggest he does not want to get involved for now, Branson was guarded about whether or not he was in talks with Honda. "If we are in discussions then I wouldn't be allowed to say so because there would be some kind of clause that would prohibit me talking about it."